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Export processing zones : a review in need of update


  • Takayoshi Kusago
  • Tzannatos, Zafiris


In the last three decades, the effects of export-oriented industrialization have called into question the once popular import substitution strategies. This change has been parallel to the development of Export Processing Zones (EPZs). Though initially found in a small number of countries, mainly ASEAN ones, such as Hong Kong (China), the Republic of Korea, and Singapore, EPZs are now found in more than 90 countries. The EPZ's role is typically seen as an instrument for expanding and modernizing the host economy through additional investment/capital formation, technology transfer, and employment generation. In addition to these direct effects, EPZs are expected to create ripple effects on the rest of the economy. The objective of this report is to update some issues and studies on export processing zones (EPZs). It first provides a brief overview of trends in EPZs and then discusses a series of issues such as investment and types of industry in EPZs (incentive scheme, foreign ownership, types of industry, and labor composition), technology transfer (backward linkages and skill formation), and workers in EPZs (wages, working conditions, and trade unions). In the last section, the report discusses lessons from different EPZ experiences and the future agenda.

Suggested Citation

  • Takayoshi Kusago & Tzannatos, Zafiris, 1998. "Export processing zones : a review in need of update," Social Protection and Labor Policy and Technical Notes 20046, The World Bank.
  • Handle: RePEc:wbk:hdnspu:20046

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    References listed on IDEAS

    1. Willmore, Larry, 1995. "Export processing zones in the Dominican Republic: A comment on Kaplinsky," World Development, Elsevier, vol. 23(3), pages 529-535, March.
    2. Din, Musleh-ud, 1994. "Export processing zones and backward linkages," Journal of Development Economics, Elsevier, vol. 43(2), pages 369-385, April.
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    Cited by:

    1. Toke Aidt & Zafiris Tzannatos, 2002. "Unions and Collective Bargaining : Economic Effects in a Global Environment," World Bank Publications, The World Bank, number 15241.
    2. Cling, Jean-Pierre & Razafindrakoto, Mireille & Roubaud, Francois, 2005. "Export processing zones in Madagascar: a success story under threat?," World Development, Elsevier, vol. 33(5), pages 785-803, May.
    3. Amara, Jomana, 2008. "Military industrialization and economic development: Jordan's defense industry," Review of Financial Economics, Elsevier, vol. 17(2), pages 130-145.
    4. Aradhna Aggarwal, 2007. "Impact of Special Economic Zones on Employment, Poverty and Human Development," Working Papers id:1111, eSocialSciences.


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